![]() |
Free sophisticated software
I haven't fully explored this yet but it looks pretty special.
http://www.championpicks.com.au/blo...cing/rewardbet/ |
Staking and money management are the most underrated aspects of gambling
One view I saw expressed a while back by a professional punter was that the handicapping of horses is a science, whilst the wagering element is an art. Would suggest a different kind of approach for each? LG |
Quote:
|
Quote:
LG PS I call on Demodocus for further input here |
Quote:
note: all examples below use American odds Example: horse with 5:1 odds and an expected 3% edge BR = bankroll = $100,000 p = expected win probability q = expected loss probability A = net odds (American) e = (A+1)p-1>0 f* = fraction of BR to invest = e/A f*BR = amount invested EV = expected value = ef*BR p = .1717 A = 5 e = (5+1)*.1717-1 = .03 f* = .03/5 = .006 f*BR = $100,000*.006 = $600 EV = $600*.03 = $18 The short form: edge = 3% odds = 5 edge/odds = 3%/5 = .6% optimal bet = .6% * $100,000 = $600 EV = $600*3% = $18 With a 3% edge and a $100,000 bankroll, your optimal bet on a 5:1 horse is $600. Your expected value is $18. Constructing an optimal hedge bets on two or more horses is a little more difficult. Let’s say that you have a race with a 5:1 and a 25:1 horse, each with an expected 3% edge: P(a) = .1717 P(b) = .0396 First you calculate what is called the reserve rate: r = reserve rate = (1-sum(each p bet))/(1-sum(each 1/(A+1))) r = (1-(.1717+.0396))/(1-((1/(5+1))+(1/(25+1))))) = .9923 Then you calculate the optimal percentage of your bankroll to invest: f* = p-r/A f*(a) = .1717-(.9923/6) = .00629 f*(b) = .0396-(.9923/26) = .00145 The optimal amount that you bet on each horse is: f*(a)BR = .00629*100,000 = $629 f*(b)BR = .00145*100,000 = $145 Your expected value is: EV(a) = $629*.03 = $18.87 EV(b) = $145*.03 = $ 4.36 EV(total) = $23.23 Note that EV(a) = $18.87 > EV = $18.00 above. Even though they’re both 5:1 horses with an expected 3% edge, you are able to optimally bet more on a given horse if it is hedged with one or more other horses. Of course, the Kelly Criterion can also be applied to both vertical and horizontal exotics. You should always place all bets in a race for which you have a positive expected value. With relatively large bankrolls and/or small pools, the calculated optimal Kelly bet may exceed the amount that will return maximum expected value from the parimutuel pool(s). To calculate the optimal bet in these cases involves a delightful foray into the world of non-linear programming, far beyond the scope of this thread. |
Quote:
|
Not a lot of 'art' in Post No. 5 above. Maths/science? Yes.
Thanks for your detailed contribution here ML. Point taken! Cheers LG |
ML, can you use the Kelly for lay staking?
RP |
Quote:
Which is why I would personally never use Kelly Criterion. For those backing multiple horses per race, reward bet, is probably the best option out there at present. For those backing single selections, I'm led to believe there is no advantage. |
All times are GMT +10. The time now is 04:28 AM. |
Powered by: vBulletin Version 3.0.3
Copyright ©2000 - 2024, Jelsoft Enterprises Ltd.